Key takeaways
A lawyer retainer fee is an upfront fee clients pay to secure legal services and reserve the attorney’s time.
It ensures the client has access to representation when needed and helps the firm guarantee partial payment for future work.
Common types of legal fees include entry fees, advance retainer payments, and structured retainer agreements outlining services and payment terms.
Lawyer retainers are fees paid upfront by the client to secure the services of an attorney. They reserve the time and expertise of a lawyer, making them accessible to the client for an agreed-upon time. They also provide peace of mind, knowing that the client has dedicated legal representation when needed. The amount of the retainer fee can vary and may be a flat fee or an hourly rate.
However, attorneys on retainer are often the subject of misunderstandings between clients and attorneys. As your client’s legal representative, it’s important to be well-informed and transparent about how retainers work to protect both parties and promote a positive client experience.
In this article, we'll explore what a lawyer retainer is, how it works, and why attorneys should use it at their firm. We'll also share best practices for implementing retainers to ensure a smooth process and increased client satisfaction.
What is a lawyer retainer?
A lawyer retainer is a financial agreement between a client and an attorney that secures legal services before work begins. It typically involves an upfront payment, also known as a retainer fee. This fee can vary based on the lawyer’s experience, practice area, and the complexity of the matter.
The retainer model is especially beneficial for businesses or individuals with recurring legal needs.
Retainer agreements are sometimes referred to as attorney fee agreements or legal services agreements, though the terms can vary depending on the structure of the arrangement. Here are the distinctions:
Retainer agreement refers to a contract that includes terms for a retainer fee and the client’s upfront retainer payment.
Attorney fee agreement focuses more broadly on how legal fees will be calculated and paid. You can download our sample attorney fee agreement to use as a template for this document.
Legal services agreement is the most general term and may include a retainer or other fee structures (e.g., flat fee, contingency).
Components of a lawyer retainer agreement
Legal retainer agreements are most effective when tailored to the client and the case, but several fundamental elements should be included in most agreements:
Services to be provided
Duration of the contract
Attorney per-hour rate
Billable costs to the client
Payment schedule
Types of legal retainer structures
Attorneys can structure retainers in a variety of ways depending on the engagement and client needs. Understanding the differences helps both parties manage expectations and maintain compliance:
Advance fee retainer: A deposit for future legal services. Funds are placed in a trust account and drawn down as work is completed. This model is one of the most common and is well-suited to matters with variable workloads or ongoing support.
Evergreen retainer: A type of advance retainer that requires the client to replenish the balance once it falls below a specified amount. This structure ensures the firm always has funds available, supporting ongoing representation and simplifying cash flow management.
Flat fee retainer: A fixed fee for a defined scope of work, often used for routine or predictable matters such as contract drafting, uncontested divorces, or basic estate planning. This model promotes transparency and cost certainty for clients.
Hybrid retainer: Combines elements of flat fees and hourly billing, or contingency plus hourly work. This approach is particularly useful for complex litigation or matters where upfront costs must be covered while preserving potential for future recovery.
Each structure offers different advantages in terms of predictability, billing flexibility, ethical compliance, and client trust. The key is to match the retainer type to the legal matter and clearly outline the structure in the retainer agreement.
Types of legal retainer fees
Legal retainers generally fall into two categories, each with its own ethical and operational considerations. Understanding these differences is essential for managing legal retainer funds properly:
Unearned fees: These are funds paid in advance but not yet earned by the attorney. They must be held in a designated trust or Interest on Lawyers' Trust Account (IOLTA) and may only be transferred to the operating account once legal work is completed. This is common with advanced and evergreen retainers.
Earned fees: These are fees that the lawyer has rightfully earned after delivering legal services. At this point, the funds can be moved from the trust account to the firm’s operating account and are no longer subject to trust accounting rules.
Improperly handling unearned fees—such as withdrawing them prematurely or failing to keep them separate from operating funds—is a frequent source of ethics violations and disciplinary action. Attorneys should refer to their state bar’s specific trust accounting requirements and review the American Bar Association’s (ABA) policy on advance payments to stay compliant.
Some states, like California, define retainer as a down payment, a fee to reserve availability, or payment for ongoing access to legal services. The state bar in Florida defines retainers as “a special fee that is payment for the lawyer’s availability to a client for legal matters.”
These practices ensure proper handling of retainer payments and reinforce the integrity of attorney retainer fees.
Attorney retainer fee vs. standard legal fees
Unlike standard legal fees—such as hourly, contingency, or flat fees—a retainer fee is primarily used to secure availability. While an hourly or flat fee pays for a specific service, a retainer ensures access to legal services as needed. In some cases, retainer fees for lawyers are drawn down as work is performed; in others, they simply guarantee availability and may be non-refundable. This distinction makes retainers especially attractive to clients who anticipate ongoing legal needs, such as business owners or high-net-worth individuals.
For attorneys, it offers predictable income and can simplify client intake and workload forecasting. The right fee model depends on the nature of the legal matter, client expectations, and the firm’s operational preferences.
How much do lawyers charge for a retainer?
Lawyer retainer fees can range from a few hundred to tens of thousands of dollars, depending on the complexity of the case, geographic location, and experience of the attorney. For instance, corporate law retainers are generally higher than family law retainers. Attorneys in large metropolitan areas or those with niche specialties may charge significantly more. The fee may also vary based on whether it is a one-time legal retainer or an ongoing evergreen retainer. It’s important to set expectations early with clients and clearly outline fee terms in the retainer agreement to avoid misunderstandings around retainer fees for lawyers.
How lawyer retainers work (step-by-step process)
When a client pays a retainer fee, the lawyer agrees to take on the client's case and provide legal services during the agreed-upon period. The lawyer deposits this fee into a legal trust account, and it remains there until the lawyer earns it. If there are still available retainer funds after the work has been completed, the lawyer returns the remaining balance to the client.
Below is a simple example of how a retainer works:
The client pays the lawyer $1,000 for the retainer fee in exchange for providing legal services.
The lawyer accepts the funds and deposits them into a trust account.
The lawyer completes $750 of legal work and sends the client an invoice for approval.
The client reviews and approves the invoice.
The lawyer withdraws $750 from the trust account for payment and transfers it to an operating account.
If no further work is needed, the lawyer returns the remaining $250 to the client.
Conduct an initial consultation and present a retainer agreement
An initial consultation is an important first step in any legal engagement. It gives attorneys the opportunity to assess the client’s legal situation, determine if a retainer is appropriate, and establish trust through clear communication. For clients, it provides a chance to ask questions, understand the scope of representation, and get comfortable with the attorney’s approach.
Following the consultation, present a lawyer retainer agreement for the client to review and sign. A lawyer retainer agreement outlines the terms and conditions of the working relationship between a client and a lawyer. It ensures that both parties clearly understand their expectations and responsibilities.
Collect retainer payment and entry fee (if applicable)
Next, the attorney collects the advance retainer fee and places it in a legal trust account, complying with IOLTA rules.
Some firms charge an entry fee as a non-refundable, flat fee paid upfront—separate from the retainer. This fee helps cover the cost of client intake and confirms the firm will take on the matter, but it does not pay for actual legal services.
Entry fees belong to the firm upon receipt and should not be deposited into a trust account. To avoid client confusion, attorneys should clarify the distinction between retainers and entry fees at the start of the engagement.
To make payment more convenient and professional, firms should offer secure credit and debit card payments and online options. Using a legal payment processing platform also ensures that all retainer payments are properly handled in accordance with IOLTA and trust accounting requirements.
Refill the retainer balance (if on an evergreen retainer)
Retainer balances will decline as they’re used to pay for legal services. Attorneys can navigate a diminishing retainer balance in one of two ways:
Option 1: Once the balance hits zero, the attorney may switch to billing hourly or request another deposit.
Option 2: Include an evergreen retainer clause within the original fee agreement to avoid reaching a zero-balance account.
An evergreen retainer clause outlines when a client must replenish funds and by how much. This model tops off the original retainer amount as funds are expended.
For example, if you have a $4,000 retainer agreement, you may include an evergreen clause that says once the balance reaches $1,500, the client will deposit an additional $2,500 into the account.
Take our continuing legal education (CLE) course on the Current Trends in Attorney's Fees to learn about attorney fee agreements, various billing models, and your fiduciary duty as a lawyer.
Why should lawyers use a retainer?
A retainer is like insurance. Although it is not intended to cover the entire cost of the services rendered, it ensures that the lawyer is compensated for the time they spend working on a case.
Guaranteed payment for attorneys
Retainers help reduce the risk of non-payment by securing funds upfront. This not only improves your law firm collection rate but also eliminates time-consuming invoicing follow-ups and unpaid balances from non-paying clients. With funds already secured, attorneys can plan their caseloads more efficiently and minimize disruptions related to billing concerns.
Peace of mind for clients
Clients gain ongoing access to legal counsel and feel reassured knowing they have an attorney ready to assist them. A retainer agreement helps avoid surprise bills and provides clear expectations. This proactive approach builds trust and empowers clients to seek legal help before issues escalate.
Protection for both parties
Using a retainer helps establish trust between the attorney and client—while protecting both.
The client trusts the attorney to safely hold their funds until rightfully earned, and the attorney trusts the client to uphold their financial obligations when they’ve exhausted the initial retainer fee. The terms of the retainer agreement also protect each party if a conflict arises.
Download our Lawyer Billing Toolkit eBook to learn about flexible fee structures, adjusting billing to client needs, and how to use technology to improve payments and billing.
Best practices for lawyer retainers
Attorney retainers can be a powerful tool for managing the cost of legal services. We’ll go over the three most impactful ways to use retainers to improve client experience and increase referral opportunities.
Communicate with the client
Setting clear expectations will ensure that the client fully understands the agreement and has the confidence to move forward with your legal services.
Lawyers should discuss the retainer agreement in detail with their client to explain:
The terms of the agreement and how the process works
The cost of the retainer fee (and entry fees, if applicable)
Which services the agreement includes
When fees are replenished
Any key terms that require clarification
Invoices should consistently reflect all of the terms specified in the agreement. Additionally, sending clear and timely invoices keeps clients in the loop and creates a seamless billing experience with your law firm.
Set pricing tiers
Offering pricing tiers (e.g., costs for legal services performed by paralegals vs. partners) ensures clients understand how their fees are being used and helps control costs on their end. These tiered structures give clients more choice in how they engage legal services and create transparency across different roles within your firm.
Pricing tiers also provide flexibility. For example, you might offer a basic retainer that covers a limited number of billable hours or a more comprehensive plan that includes full-service support. This structure allows clients to align legal spending with their needs and budget, while helping your firm maintain predictable revenue.
Clarify your payment options
It's also important to clarify how you prefer to be paid, whether by check, credit card, or digital methods. This will help to ensure that payment is processed smoothly and that the retainer is replenished as needed.
If you use a payments solution that offers e-billing for law firms, such as 8amTM LawPay, you can streamline your practice’s billing process with seamless payments, fast processing, and easy reconciliation. Online payments can also improve your collection rate. Our 2024 Legal Industry Report found that our customers collected 33% more from clients who paid using online payments.
Improve your law firm’s retainer management with LawPay
Effectively managing retainers is essential to building a financially healthy and ethically compliant law firm—and LawPay makes it simple. From collecting advance payments to maintaining IOLTA compliance, LawPay supports every step of the retainer process.
Whether you're billing clients on an evergreen model, a flat fee, or a hybrid retainer, LawPay offers integrated tools to streamline your entire payment workflow:
Simplify legal billing for all case types
Streamline invoicing and get paid faster
Improve time tracking to align billed hours with retainer usage
Offer secure credit and debit card payment options for convenient, client-friendly transactions
These features work together to complement your retainer agreements, simplify retainer billing, and ensure payments are processed correctly and efficiently. LawPay is trusted by tens of thousands of legal professionals to deliver a seamless, modern billing experience.
Schedule a demo or sign up today to see how LawPay can elevate your firm’s billing process.
About the author
Gabriela JheanContent Writer
Gabriela Jhean is a Content Writer for leading legal software companies, including MyCase, Docketwise, CPACharge, CASEpeer, and LawPay—the #1 legal payment processor. She covers emerging legal technology, financial wellness for law firms, the latest industry trends, and more.